In the above figure, what happens to the firm's optimal level of output if the price it receives for its product decreases from P4 to P3?
A) Output stays the same.
B) Output decreases.
C) Output increases.
D) There is not enough information provided to know what happens to output.
B
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Refer to Figure 4-8. What is the value of the portion of producer surplus transferred to consumers as a result of the rent ceiling?
A) $40,000 B) $100,000 C) $125,000 D) $140,000
Prior to the establishment of the Federal Reserve System (1913), reserve requirements
(a) limited the banks' ability to lend. (b) did not restrict the amount of paper-money issued by banks. (c) freed banks to create as much money as the market could bear without regard for risk and withdrawal rates. (d) forced banks to place deposits in the national bank.
If a consumer prefers Apples to Bananas and prefers Bananas to Citrus Fruit, in order to satisfy assumptions about preferences, she has to prefer
A) Bananas to Apples. B) Citrus Fruit to Bananas. C) Apples to Citrus Fruit. D) Citrus Fruit to Apples.
The demand curve for a Giffen good is
A) non-linear but downward sloping. B) vertical. C) upward sloping. D) nonexistent.